Government intends to walk hand-in-hand with the credit union movement says Minister in the Ministry of Finance Ryan Straughn.
His pledge has come amid charges that these financial institutions were being “hamstrung” in some cases”.
Straughn’s comments came during yesterday’s official opening of the City of Bridgetown (COB) Co-operative Credit Union at Six Roads, St Philip.
COB president Adlai Stevenson had earlier contended that the credit union’s operations were being limited and that a level playing field was required.
“The credit union movement has done a lot to better the lives of Barbadians, especially in middle and low-income groups. COB would like to do a lot more because our members are asking for more. However, in seeking to respond to our members we are hamstrung in some cases by challenges which we cannot resolve on our own. These challenges relate to existing limitations on credit union operations,” Stevenson said.
“These limitations are frustrating. They are hindering us from fully capitalizing on market opportunities in support of future growth and business sustainability. We are addressing these issues in concert with other credit unions at the level of our regulators and we are hoping for a speedy resolution sooner rather than later.
“If the credit union movement is to move to the next level of development in pursuit of attaining its true potential and, at the same time, contribute more to national development, there must be a level playing field. It requires meaningful liberalization of the financial services market. This no doubt would ultimately redound to the benefit of the consumer,” the president further added.
Despite these hindrances, Stevenson said COB would soon be rolling out a contact-less international debit card as well as a suite of merchant services.
However, Straughn indicated that new legislation was coming which would provide “parity” for credit unions.
He said it would allow credit unions to become involved in deposit insurance.
“We are going to be laying out under a new Deposit Insurance Act which we will work to resolve how we will create a framework that allows for credit unions to be brought into the deposit insurance framework in order to ensure that we have parity with respect to the treatment of financial institutions across this country,” Straughn said to rapturous applause.
While Straughn lauded COB for its new initiatives, he said there was a need for credit unions to become more aggressive.
He maintained that the movement was pivotal to the development of Barbados.
“The Government remains committed to transforming the lives of Barbadians and working with the credit union movement we intend to do just that and to set the framework and the landscape through which ordinary Barbadians will not just see credit unions as a place to save, but a place where they can come and get the appropriate support for any business idea,” Straughn said.
“I am proud to hear of the proposed merchant services that you intend to roll out simply because what is required now in this country – as you are seeing the beating of a retreat which is getting louder and louder and louder within the context of the financial space. I challenge all members of the credit union including COB to become much more aggressive within the context of building out the development of Barbados.”
Straughn also congratulated COB for “executing in the face of uncertainty” the construction of a new building during, and in spite of, the COVID-19 pandemic.
Minister in the Prime Minister’s Office with responsibility for Culture and member of Parliament for the area John King said the availability of COB for the people of St Philip and the surrounding areas was a significant step.
COB’s newest branch, the first outside St Michael, was built at a cost of $3.3 million and took seven months to complete.
The state-of-the-art credit union will employ 25 persons.
As of June 30, 2020, COB had a total membership of 212,000 and total savings of $2.4 billion.
(randybennett@barbadostoday.bb)
